IDEAS home Printed from https://ideas.repec.org/p/boe/boeewp/1033.html
   My bibliography  Save this paper

Vacancy posting, firm balance sheets, and pandemic policy

Author

Listed:
  • Van Dijcke, David

    (Department of Economics, University of Michigan)

  • Buckmann, Marcus

    (Bank of England)

  • Turrell, Arthur

    (Data Science Campus, Office for National Statistics)

  • Key, Tomas

    (Bank of England)

Abstract

We assess how balance sheets propagated labour demand shocks during Covid-19 using novel matched data on firms and online job postings. Exploiting regional and firm-level variation in three pandemic policies in the UK, we find that financially healthy firms increased vacancies more in response to positive shocks. Less-leveraged firms and firms with higher credit scores increased postings more in response to the Eat Out to Help Out’s local demand subsidies and after receiving a Bounce Back Loan Scheme loan, respectively. These findings complement the link between leverage and employment losses in response to negative shocks.

Suggested Citation

  • Van Dijcke, David & Buckmann, Marcus & Turrell, Arthur & Key, Tomas, 2023. "Vacancy posting, firm balance sheets, and pandemic policy," Bank of England working papers 1033, Bank of England.
    • Handle: RePEc:boe:boeewp:1033
    as

    Download full text from publisher

    File URL: https://www.bankofengland.co.uk/-/media/boe/files/working-paper/2023/vacancy-posting-firm-balance-sheets-and-pandemic-policy.pdf
    File Function: Full text
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Coibion, Olivier & Gorodnichenko, Yuriy & Weber, Michael, 2020. "Labor Markets During the Covid-19 Crisis: A Preliminary View," Department of Economics, Working Paper Series qt7rx7t91p, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    2. David Deming & Lisa B. Kahn, 2018. "Skill Requirements across Firms and Labor Markets: Evidence from Job Postings for Professionals," Journal of Labor Economics, University of Chicago Press, vol. 36(S1), pages 337-369.
    3. Duchin, Ran & Ozbas, Oguzhan & Sensoy, Berk A., 2010. "Costly external finance, corporate investment, and the subprime mortgage credit crisis," Journal of Financial Economics, Elsevier, vol. 97(3), pages 418-435, September.
    4. repec:hal:spmain:info:hdl:2441/59cr4u3mmr9pobrceptvua5g8c is not listed on IDEAS
    5. Michelle Marcus & Pedro H. C. Sant’Anna, 2021. "The Role of Parallel Trends in Event Study Settings: An Application to Environmental Economics," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 8(2), pages 235-275.
    6. Xavier Giroud & Holger M. Mueller, 2017. "Firm Leverage, Consumer Demand, and Employment Losses during the Great Recession," Working Papers 17-01, Center for Economic Studies, U.S. Census Bureau.
    7. Giuseppe Moscarini & Fabien Postel-Vinay, 2012. "The Contribution of Large and Small Employers to Job Creation in Times of High and Low Unemployment," American Economic Review, American Economic Association, vol. 102(6), pages 2509-2539, October.
    8. Adams-Prassl, Abi & Boneva, Teodora & Golin, Marta & Rauh, Christopher, 2022. "Work that can be done from home: evidence on variation within and across occupations and industries," Labour Economics, Elsevier, vol. 74(C).
    9. Antonio Falato & Nellie Liang, 2016. "Do Creditor Rights Increase Employment Risk? Evidence from Loan Covenants," Journal of Finance, American Finance Association, vol. 71(6), pages 2545-2590, December.
    10. Brad Hershbein & Lisa B. Kahn, 2018. "Do Recessions Accelerate Routine-Biased Technological Change? Evidence from Vacancy Postings," American Economic Review, American Economic Association, vol. 108(7), pages 1737-1772, July.
    11. Bahaj, Saleem & Piton, Sophie & Savagar, Anthony, 2022. "Business creation during Covid-19," Bank of England working papers 981, Bank of England.
    12. Jack Blundell & Stephen Machin, 2020. "Self-employment in the Covid-19 crisis," CEP Covid-19 Analyses cepcovid-19-003, Centre for Economic Performance, LSE.
    13. Joseph, Andreas & Kneer, Christiane & van Horen, Neeltje & Saleheen, Jumana, 2019. "All you need is cash: corporate cash holdings and investment after the financial crisis," Bank of England working papers 843, Bank of England.
    14. Jonathan Cribb & Helen Miller & Thomas Pope & Jonathan Cribb, 2019. "Who are business owners and what are they doing?," Economic Statistics Centre of Excellence (ESCoE) Discussion Papers ESCoE DP-2019-12, Economic Statistics Centre of Excellence (ESCoE).
    15. Giuseppe Moscarini & Fabien Postel-Vinay, 2012. "The Contribution of Large and Small Employers to Job Creation in Times of High and Low Unemployment," American Economic Review, American Economic Association, vol. 102(6), pages 2509-2539, October.
    16. Myers, Stewart C., 1977. "Determinants of corporate borrowing," Journal of Financial Economics, Elsevier, vol. 5(2), pages 147-175, November.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Masami Imai & Michiru Sawada, 2022. "Does a Financial Crisis Impair Corporate Innovation?," Wesleyan Economics Working Papers 2022-002, Wesleyan University, Department of Economics.
    2. Hansen, Stephen & Lambert, Peter John & Bloom, Nicholas & Davis, Steven J. & Sadun, Raffaella & Taska, Bledi, 2023. "Remote Work across Jobs, Companies, and Space," IZA Discussion Papers 15980, Institute of Labor Economics (IZA).
    3. Ben S. Bernanke, 2018. "The Real Effects of Disrupted Credit: Evidence from the Global Financial Crisis," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 49(2 (Fall)), pages 251-342.
    4. Shai Bernstein & Richard R. Townsend & Ting Xu, 2020. "Flight to Safety: How Economic Downturns Affect Talent Flows to Startups," NBER Working Papers 27907, National Bureau of Economic Research, Inc.
    5. John (Jianqiu) Bai & Erik Brynjolfsson & Wang Jin & Sebastian Steffen & Chi Wan, 2021. "Digital Resilience: How Work-From-Home Feasibility Affects Firm Performance," NBER Working Papers 28588, National Bureau of Economic Research, Inc.
    6. Bahaj, Saleem & Foulis, Angus & Pinter, Gabor & Surico, Paolo, 2022. "Employment and the residential collateral channel of monetary policy," Journal of Monetary Economics, Elsevier, vol. 131(C), pages 26-44.
    7. Friedrich, Benjamin U. & Zator, Michał, 2023. "Flexibility costs of debt: Danish exporters during the cartoon crisis," Journal of Financial Economics, Elsevier, vol. 148(2), pages 91-117.
    8. Alex Clymo & Filip Rozsypal, 2022. "Firm Cyclicality and Financial Frictions," Discussion Papers 2207, Centre for Macroeconomics (CFM).
    9. Consolo, Agostino & Petroulakis, Filippos, 2022. "Did COVID-19 induce a reallocation wave?," Working Paper Series 2703, European Central Bank.
    10. Gu, Ran & Zhong, Ling, 2023. "Effects of stay-at-home orders on skill requirements in vacancy postings," Labour Economics, Elsevier, vol. 82(C).
    11. Pierre Cahuc & Stéphane Carcillo & Thomas Le Barbanchon, 2017. "The Effectiveness of Hiring Credits," SciencePo Working papers Main hal-03393157, HAL.
    12. Ghaly, Mohamed & Dang, Viet Anh & Stathopoulos, Konstantinos, 2020. "Institutional investors' horizons and corporate employment decisions," Journal of Corporate Finance, Elsevier, vol. 64(C).
    13. José Azar & Emiliano Huet-Vaughn & Ioana Marinescu & Bledi Taska & Till von Wachter, 2019. "Minimum Wage Employment Effects and Labor Market Concentration," NBER Working Papers 26101, National Bureau of Economic Research, Inc.
    14. Custódio, Cláudia & Ferreira, Miguel A. & Laureano, Luís, 2013. "Why are US firms using more short-term debt?," Journal of Financial Economics, Elsevier, vol. 108(1), pages 182-212.
    15. Maciej Berk{e}sewicz & Herman Cherniaiev & Robert Pater, 2021. "Estimating the number of entities with vacancies using administrative and online data," Papers 2106.03263, arXiv.org.
    16. Wenlian Gao & Feifei Zhu & Kai Chen, 2023. "The role of bank lenders in firm leverage adjustments," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 46(1), pages 63-97, February.
    17. Sai Ding & Alessandra Guariglia & John Knight & Junhong Yang, 2021. "Negative Investment in China: Financing Constraints and Restructuring versus Growth," Economic Development and Cultural Change, University of Chicago Press, vol. 69(4), pages 1411-1449.
    18. Dang, Viet Anh & Kim, Minjoo & Shin, Yongcheol, 2014. "Asymmetric adjustment toward optimal capital structure: Evidence from a crisis," International Review of Financial Analysis, Elsevier, vol. 33(C), pages 226-242.
    19. Zilian, Laura S. & Zilian, Stella S. & Jäger, Georg, 2021. "Labour market polarisation revisited: evidence from Austrian vacancy data," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 55, pages 1-7.
    20. Stephen Hansen & Tejas Ramdas & Raffaella Sadun & Joe Fuller, 2021. "The Demand for Executive Skills," NBER Working Papers 28959, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    Covid-19; recession; vacancies; Indeed; job postings; job ads; heterogeneity; firm; firm-level; balance sheets; industry; big data; alternative data; labour market; natural language processing;
    All these keywords.

    JEL classification:

    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General
    • D20 - Microeconomics - - Production and Organizations - - - General
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:boe:boeewp:1033. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Digital Media Team (email available below). General contact details of provider: https://edirc.repec.org/data/boegvuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.